GD Chopping More Jobs, Closing Sites in UK

Jul. 18, 2013 - 03:45AM
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LONDON — General Dynamics is axing more jobs in the UK and closing the majority of its sites just weeks after it announced a reorganization and a first round of redundancies in the business here.

The company, one of General Dynamics’ biggest operations outside of its US base, is to cut 200 workers as well as close facilities at Andover, Pershore and Ashchurch in England and Newbridge in South Wales.

General Dynamics UK’s headquarters office in London is also being closed.

Together with earlier cuts and natural reductions, the new round of redundancies will see the company’s workforce here slashed by nearly 40 percent.

The move will leave the UK business with facilities at Oakdale in South Wales, where it works on the Bowman communications and SV armored vehicle programs for the British Army, and the Hastings plant in southern England where it runs its avionics and security businesses.

In April, General Dynamics said it was cutting 185 jobs from its 1,600 strong across the UK as part of a restructuring move that saw the US company take control of its armored vehicle programs here and its Canadian subsidiary responsible for communication systems activities, also here.

Previously, both these activities had been controlled locally alongside a growing securities business.

A spokesman for General Dynamics in the US said the UK business has been restructuring to better respond to market conditions.

“As part of the process we have proposed jobs losses and a consolidation of facilities to maintain the business competitiveness and reduce costs in the face of declining demand in some of our markets,” he said.

The businesses associated with the closed sites will continue but be consolidated at Oakdale and Hastings, said the spokesman.

Along with natural wastage of staff employees, numbers at the UK operation will have shrunk to about 1,000 by the time the rationalization effort in completed in mid-2014 he said.

The restructuring earlier this year saw UK company executive Steve Rowbotham appointed chief operating officer to replace Sandy Wilson, who retired as the company’s president earlier this year.

Wilson was subsequently appointed to the General Dynamics UK board as a non-executive director but has now resigned.

The spokesman said Wilson’s departure had resulted in order to avoid a conflict of interest in a new business he was pursuing.

One senior US company executive said the retrenchment in the UK reflected current General Dynamics policy to focus on delivering already contracted programs in the USA rather than seek growth from international business.

“It’s a strategy which contrasts strongly with their rivals at Lockheed Martin who announced the other week they were setting up a new international operation in London to pursue export growth opportunities,” he said.

General Dynamics UK has expanded over the last decade to become one of Britain’s top defense companies on the back of a deal to supply the British Army’s Bowman tactical communications system and a contract to design and develop a new armored scout vehicle.

Future Bowman work is under threat with the British Ministry of Defence looking to compete the next generation development of communications and information requirements in a program known as LETacCis.

The company is working on a family of specialist armored vehicles for the Army here but the £500 million (US $758.4 million) contract only covers development.

With Lockheed Martin’s update of the Warrior infantry fighting vehicle currently the Army’s top priority, the future and scope of the General Dynamics production contract looks vulnerable in the face of continuing budget austerity.